Video game sales flat in October, but downloads continue to rise

As game makers prepare their best titles for the holiday season, the video game industry has yet to bounce back.

Total sales of video games at US retail shops remained flat in October, coming in at $790.7 million, within a percentage point of the same time a year ago, according to a report by industry watcher NPD Group.

But the devil's in the details: Software sales are still falling, while purchases of new video game hardware have jumped. NPD analyst Liam Callahan said in a statement that purchases of new Xboxes and PlayStations account for close to 80 percent of dollars spent this month.

The top-selling title for the month was Take-Two Interactive Software's NBA 2K15, with Nintendo's Super Smash Bros. for the 3DS handheld coming in second. The Evil Within, a horror game from Bethesda Softworks, ranked third. Overall, game sales fell 28 percent year over year to $359 million.

The data illustrates the game industry's biggest problem at the moment: selling new games. Even as players pick up the nearly year-old Xbox One and PlayStation 4 video game consoles, software sales continue to fall. Those who have yet to make the switch from older hardware have stopped buying games for those platforms faster than expected, executives say. They hope that as game makers continue to push out new titles, the industry will resume growing at a faster pace.

"Declines in software this month were driven by further declines of [older] software, which were not fully offset by gains in [new] consoles," Callahan said.

But there's still hope for the game industry to recover. November has seen the release of the latest installments of many large franchises. Those include Activision Blizzard's war simulation series Call of Duty and Ubisoft's Assassin's Creed, both of which were filled out with new titles during the last two weeks.

Microsoft released its remastered Halo collection in November as well, and the company's $50 price cut to its Xbox One took effect November 2. Before those moves, however, hardware sales grew only 59 percent year over year compared with 136 percent growth in the month of September, NPD said.

Sales of games over the Internet were a brighter spot in October. Full-game downloads, subscriptions and purchases of additional game storylines rose for consoles, PCs and mobile devices to $957 million, according to SuperData Research, a research firm that focuses on the Internet-delivered video games.

Notably, console games bought and delivered over the Internet rose to $96 million, with one out of five owners of Destiny, a multiplayer shooter from publisher Activision, purchasing the title as a download through an online marketplace instead of on a physical disc. Overall software sales made over the Internet were $308 million, up 27 percent year over year and closing in fast on retail sales.